Problems 1. Lakewood Laser SkinCare's ending cash balance as of January 31, 2018 (the end of its fiscal year 2017) was $15,000. Its expected cash collections and payments for the next six months are given in the following table. Month Collections Payments February $37,125 $43,650 March 41,175 46,800 April 51,075 48,600 May 65,475 54,675 June 73,125 60,075 July 81,000 61,200 Calculate the firm's expected ending cash balance for each month. b. Assuming that the firm must maintain an ending cash balance of at least $12,000, how much must they borrow during each month? If the firm must pay 5% annual interest on its short-term borrowing, what are your ending cash balances for each month? d. What are the ending cash balances if the firm uses any cash in excess of the minimum to pay off its short-term borrowing in each month? a. c. 1. Meyerson's Bakery is considering the addition of a new line of pies to its product offerings. It is expected that each pie will sell for $15 and the variable costs per pie will be $9. Total fixed operating costs are expected to be $25,000. Meyerson's faces a marginal tax rate of 35%, will have interest expense associated with this line of $3,500, and expects to sell about 4,200 pies in the first year. Create an income statement for the pie line's first year. Is the line expected to be profitable? Calculate the operating break-even point in both units and dollars. How many pies would Meyerson's need to sell in order to achieve EBIT of $20,000? a. d. Use the Goal Seek tool to determine the selling price per pie that would allow Meyerson's to break even in terms of its net income. e. Calculate the DOL, DFL, and DCL for the new pie line. Income statements for Siam Foods, Inc. from 2014 to 2016 appear below. Siam Foods, Inc. Meyerson's Bakery is considering the addition of a new line of pies to its product offerings. It is expected that each pie will sell for $15 and the variable costs per pie will be $9. Total fixed operating costs are expected to be $25,000. Meyerson's faces a marginal tax rate of 35%, will have interest expense associated with this line of $3,500, and expects to sell about 4,200 pies in the first year. Create an income statement for the pie line's first year. Is the line expected to be profitable? 6 Calculate the operating break-even point in both units and dollars. How many pies would Meyerson's need to sell in order to achieve EBIT of $20,000? d. Use the Goal Seek tool to determine the selling price per pie that would allow Meyerson's to break even in terms of its net income. e. Calculate the DOL, DFL, and DCL for the new pie line. Income statements for Siam Foods, Inc. from 2014 to 2016 appear below